Construction index at GFC levels: Midday Roundup

Conditions in the construction sector last month reached their lowest levels since the global financial crisis, according to the Australian Industry Group Australian Performance of Construction Index, run in conjunction with Housing Industry Association.

The index fell 2.1 points to 30, the lowest reading since February 2009 and well below the 50-point mark separating expansion and contraction.

The fall was attributed to “further marked falls in activity, new orders and employment.”

AIG group director public policy Peter Burn said the sector “continues to struggle in the face of subdued demand and low levels of investor and consumer confidence.”

“Lower interest rates would assist in reigniting demand for housing and commercial construction in particular. However, the extent of uncertainty hanging over the domestic and global economy points to a continuation of tough times for the industry.”

Australian sharemarket set to end week on high

Meanwhile, the Australian sharemarket is trading well today, boosted by the European Central Bank’s decision to shore up European banks in case Greece defaults on its debt.

At 11.30 AEST, the benchmark S&P/ASX 200 index was up 1.98% to 4150.5 and the broader All Ordinaries Index had risen 1.94% to 4211.0.

This follows the biggest one-day rally in more than three years yesterday.

IG Markets analyst Cameron Peacock tipped broad-based gains among the materials, energy and financial sectors.

“While another positive open is forecast and we look set to close out the week with some encouraging momentum, it could all come unstuck should tonight’s non-farms payroll reports disappoint.”

“Expectations are for approximately 60,000 jobs to have been created but we have been hearing whispers numbers of up to 80,000.”

Meanwhile the Australian dollar is now at $US0.97 after its fall earlier this week. CMC Markets senior exchange dealer Tim Waterer has written that the rise comes after improvements in the European situation this week.

“However, I do think we will see a lid on gains throughout the afternoon and evening on the AUD, with the US Non-Farm Payrolls hurdle lying in wait tonight.”

National Leisure and Gaming in administration

National Leisure and Gaming has announced it has appointed voluntary administrators after lenders would not extend credit facilities.

The company said in a statement PwC had been appointed as administrations.

The company owns a number of properties including the Bankstown Club Hotel, Campbelltown Club Hotel and the Swell Tavern in Burleigh Heads.

“In these circumstances, the directors were not able to conclude that the NLG Group would be able to continue as a going concern,” NLG said, according to AAP.

Obama urges European leaders to act quickly on debt

US president Barack Obama has urged European leaders to act quickly on their respective debt situations, saying “they’ve got to act fast”.

“We have got a G20 meeting coming up in November. My strong hope is that by the time of that G20 meeting, that they have a very clear concrete plan of action that is sufficient to the task,” he said at a press conference.

“The problems Europe is having today could have a very real effect on our economy at a time when it’s already fragile,” Obama said.